Canadians’ concerns about the cost of living have proven highly resilient, with negative consumer sentiment still common even as the Bank of Canada (BoC) pushes deeper into an easing cycle and inflation stays markedly lower than its post-pandemic peak.

The latest evidence of ongoing struggles for many comes from two surveys, one about future planning and the other about Canadians’ debt levels. These follow recent Canada Pension Plan Investment Board research showing widespread worry about retirement savings.

The BoC is “very aware” of Canadians’ enduring gloomy mood, governor Tiff Macklem acknowledged during the Bank’s most recent rate-cut announcement. “Yes, you can see it in our own consumer survey — there is a lot of hesitancy,” Macklem said.

“So inflation is a measure of how fast prices are increasing, but I think what Canadians feel is life's more expensive now than it was two years ago,” Carolyn Rogers, the BoC deputy governor, said at the same announcement. Though prices are no longer rising rapidly, she says, every trip to the grocery store serves as a reminder of how much they’ve gone up.

Inflation remains a key worry

A survey conducted for estate planning platform Willful, published Monday, offers some evidence of this. On average, respondents estimated household expenses have gone up 22 per cent in the last 12 months — far more than the annualized CPI figure for September of 1.6 per cent. Some 86 per cent say they’re “worried about the impact of inflation on their financial goals.”

“It's rational that interest rates are coming down, and so we should feel relief,” said Erin Bury, Willful’s CEO and co-founder. “But in reality, the psychology is so much different. And I would still say, for most of the people in my peer group, who are largely young parents, many of them living in big cities where cost of living is higher, I would say there's not that sense of relief yet.”

In the survey, 42 per cent of respondents say they’re worse off now than they were on January 1 of this year, and 48 per cent say they had used savings to cover day-to-day expenses in the past year. Some 72 per cent say the current economic situation has led them to delay financial goals.

“I'm not an economist, but it seems to be that the economy is in a bit of a better position than it was January 1,” Bury said. “But Canadians say that they are actually in a worse place, and that, paired with this idea of the majority of people putting things off their list, and, you know, actually dipping into savings and kind of being behind the eight ball is the thing that stuck out the most to me.”